It's all very confusing, the USDA report was bullish to mildly bullish, crude oil finished almost $3 higher, yet the grains ran out of steam again.

Beans had earlier set a two month high as China continued to buy, ending stocks figures remained tight and the Argy crop was dropped by 4mmt.

It seems that, in a complete reversal to twelve months ago, the tail is wagging the dog. No matter how bullish the news, the market wants to go down.

US soybean ending stocks are projected tight at 165 million bushels. For corn it was just two months ago we were at a 1.79 billion bushel ending stock estimate and now we are at 1.70.

For wheat there were few surprises, with carryover stocks coming in very much in line with expectations.

May soybeans finished at $10.07, up 1 cent, a whopping 43 cents off session highs. May CBOT wheat closed at $5.22, down 10 cents on the day and 21 cents off session highs. May corn closed at $3.90 ¼, down 6 ¾ cents, 14 ½ cents off the highs.

US farmers have said they will abandon 200,000 acres of spring wheat in North Dakota and 100,000 acres each in South Dakota and Minnesota this summer due to record-breaking winter and spring snowfall and flooding, says Allen Motew of QT Weather.

Experts believe a further decline in acreage will result as heavy snow and further flooding occurred after the survey while soil temperatures reports show saturated or frost levels to 30 inches or more. Yields are projected to drop to the 5-year average of 38 bushels per acre from 40.5 last year, says Allen.

According to hydrologists at the River Forecast Center, “extreme meteorological conditions have dominated over the past 7 months”, and the fact that spring is just beginning, the Red River and its tributaries will be very susceptible to additional flooding for the remainder of Spring and into the Summer. Soil moisture rankings remain in the 99-percentile range across North Dakota, NW Minnesota and northern South Dakota. Around 72% of the nation’s spring wheat is grown across the Dakotas and W Minnesota, he adds.

The USDA reports didn't throw up too many surprises, merely confirmed what the trade already suspected: old crop soybean stocks are tight.

Other stocks data also came in right in line with expectations.

The weekly export sales confirmed the continued presence of China in the market, booking 238,700 MT of old crop and 110,000 MT of new crop. Overall, the sales figures were in line with what was anticipated.

The USDA also dropped the Argentine soybean crop 4 million tonnes to 39 million.

The USDA Weekly Export Sales Report for the period March 27-April 2, 2009 came out at 13.30BST:

Corn

Net sales of 1,062,800 MT for 2008/09 and 18,900 MT for delivery in 2009/10. Japan was the biggest home taking 411,900 MT. This compares with pre-report trade ideas for sales of 900-1,000,000 MT.

Soybeans

Net sales of 431,500 MT for 2008/09 and 190,200 MT for delivery in 2009/10. China took 238,700 MT of old crop and 110,000 MT of new crop. This compares with pre-report trade ideas for sales of 750-850,000 MT.

Wheat

Net sales of 189,400 MT for 2008/09 and 184,200 MT for delivery in 2009/10. This compares with pre-report trade ideas for sales of 300-400,000 MT.

Beans closed around 17 cents firmer in nearby months, with spillover strength helping corn close with gains of around 3 cents and wheat 5-7 cents higher.

Firmer crude oil, up around a dollar and a half, and stock markets also helped boost the grains.

The main number of interest this afternoon will possibly be the soybean 2008/09 ending stocks, which were 185 million bushels last month, but could fall as low as 101 million according to one trade estimate (the average guess is a more conservative 169 million). Certainly a number of 150 or below would be construed as very bullish for old-crop months.

The USDA will also report on world crop production, with the Argentine & Brazilian soybean crop estimates of interest.

In addition, the usual Thursday export sales numbers may re-affirm that China is still around buying US beans.

Dairy Farmers of Britain were first to jump onto the price cut bandwagon set rolling by Arla and First Milk earlier in the week, by announcing a hefty 2.2ppl cut effective from Apr 1st yesterday.

That's right, they announced on the 8th April that a price cut was effective from 1st April. And no, it isn't a back-dated April fool.

But hang on a minute, didn't DFB chairman Lord Grantchester promise members back in November that there would be no more retrospective price cuts and that everyone would receive advance notice of any future price adjustments?

Erm, well yes he did, but he must have had his fingers crossed or something, so that doesn't count.

The RPI rate of inflation fell to 0% in March latest figures reveal. Cool, people might be getting their pay frozen, but at least prices in the shops aren't going to go up either so we can still afford to eat right?

Erm, well it might be a little more complicated than that. The RPI data, crucially, includes housing costs. Data from the British Retail Consortium (BRC) reveals that food inflation was 9% in February and March, up from 7.5% in January and 6.2% in December. Meanwhile the cost of non-food items fell by 1.5% in March, adding to a 1.7% drop in February. Clearly combining non-food items and housing costs in with food items is distorting the look of the RPI.

The BRC say that the weak pound is the reason for food prices increasing as retailers are paying more to their suppliers. I can think a few industries that would like to take issue with the BRC on that one.

So farmgate milk prices are falling month-by-month, whilst food prices in the shops are rising steadily and people are losing their jobs or taking pay freezes. Meanwhile farmers are quitting the industry left right & centre with milk production is at its lowest in 34 years and continuing to fall.

Sounds like a recipe for disaster to me. Still, we can all eat our mobile phones if we're hungry. I can just picture us next Christmas, tucking into Widescreen Plasma TV with all the trimmings.

An interesting Wall St Journal blog posting by Russell Gold: "Put down that Quarter Pounder or the fish get it" highlights some of the potential environmental implications of pursuing the current US ethanol mandate. You can read what he has to say here.

Following on in the same theme, another article worth a read is in the Economist, which points out that nitrogen-hungry corn in particular is a very unfriendly crop to grow from a "green" point of view. You can read that article here: here.

When are legislators going to wake up to the fact that these renewable fuel mandates have created the Bride of Frankenstein? A giant loop-hole riddled system that the multi-national conglomerates are gleefully driving their corporate buses through chortling all the way to the bank?

If the powers that be don't sort it out soon then it could all end up messier than a Christmas Day episode of Eastenders.

Crude oil is higher this morning despite news from the US Energy dept. yesterday pegging US stocks 1.65 million barrels higher at just over 361 million barrels. That was the 24th increase in the last 28 weeks, taking US stocks to their highest levels since 1993.

The market is actually viewing the data as not as bad as was feared. The American Petroleum Institute had said Tuesday that stockpiles jumped by 6.94 million barrels to the highest since 1990.

Stockpiles at Cushing, Oklahoma, the delivery point for West Texas Intermediate crude oil, fell 878,000 barrels to 29.98 million last week, the lowest since the week ended Dec. 26.

Stocks are still huge, and consumption is still falling. Daily fuel demand was down 4.4% from a year ago, with the last four weeks posting the lowest fuel consumption since October, according to the report.

With US stocks still so high, Brent crude is running at around a $2/barrel premium to WTI at the moment. At 10.30am BST WTI was $1.51 higher at $50.89/barrel with Brent having reached as much as $1.89 higher to 53.48/barrel.

Although today's Weekly Export Sales report from the USDA may be eclipsed by the WASDE and stocks data, the numbers will still be scrutinised for evidence that demand for US grains & oilseeds remains robust.

Recent export sales have been encouraging, and the USDA reported 110,000 MT of soybean sales to China again yesterday.

The Brazilian minister of Agriculture, Reinhold Stephanes, believes that the Brazilian wheat production should grow by 10% this year, and may cater to as much as 60% of domestic demand.

The state of Parana accounts for more than 50% of national production. According to the secretary of Agriculture of the state, Valter Bianchinni, the state government, in partnership with the Bank of Brazil, will ensure that there will be no shortage of funds to wheat farmers, and that a 5% growth in planted area is expected.

"If the weather helps, then Parana is going to have as good a crop as last year's, which yielded 3.2 million tonnes, or even a bit more, at 3.5 million tonnes, due to the larger planted area," Bianchinni told Agencia Brasil.

Brazil's wheat crop has grown steadily in the last few years, from just 2.3 million tonnes in 2006, to 4.1 million tonnes in 2007 and around 6 million tonnes in 2008.

The need for Brazil to produce more wheat has increased, especially after Argentina, the country's main supplier, had a drastic reduction in its production in 2008.

Brazil will probably need to import over 4 million tonnes this year, a volume that is not going to be fully supplied by Argentina, and has recently announced a trade agreement to take wheat from Russia in exchange for soy.

Planting in Parana state, which accounts for 54% of national production, takes place in April/May and the harvest is September through to the end on November. The other main producing state in the country is Rio Grande do Sul, which accounts for around 38% of output, planting later in the year May/June for harvest October/December.

The participation of President Cristina Fernandez de Kirchner in the London G20 summit may have been a preamble from the country to repair its relationship with the IMF, according to press reports in the Buenos Aires.

La Nacion points out that the long G20 statement in one of its chapters refers to the "IMF surveillance of G20 economies and financial sectors", which was signed by Mrs. Kirchner in spite of the virulent rhetoric both from her and husband former president Nestor Kirchner, who blame the IMF for most of the Argentine economy shortcomings.

The article says "we will conduct all our economic policies cooperatively and responsibly with regard to the impact on other countries and will refrain from competitive devaluation of our currencies and promote a stable and well-functioning international monetary system. We will support, now and in the future, to candid, even-handed, and independent IMF surveillance of our economies and financial sectors, of the impact of our policies on others, and of risks facing the global economy".

The Kirchners Argentina virtually has no relations with the IMF since the country paid back to the multilateral organization all its pending debts a few years ago, borrowing the money instead from neighbouring staunch ally Venezuela in a deal personally arranged by Hugo Chavez.

Argentina has since refused any surveillance of its economy. This attitude and the holdouts from the massive restructuring of the defaulted 2002 debt have left Argentina with virtually no access to international money markets. It has been able to manage up until now with strong trade and budget primary surpluses from a booming economy benefited with international windfall prices for commodities. But circumstances since last year have changed dramatically.

According to La Nacion the Kirchners have had an enforced change of heart and recently contacted the Ministry of Economy to confirm the support of "IMF surveillance" Article IV.

Subsequently in late February David Hawley, spokesperson for the IMF, said "We are very interested in a close relation with Argentina", adding that in the coming months the "Article IV consulting process will take place normally".

In related news another Buenos Aires daily which specializes in financial news Ambito Financiero, said that the administration of Mrs. Kirchner is seeking a 10 billion US dollars line of credit from the US Federal Reserve.

"Government officials are looking for US credit after lining up a currency swap with China for the same amount in a deal announced March 30", the Buenos Aires-based newspaper said, without identifying the source of its information.

However "the US government may be unwilling to extend the line of credit given that Argentina has yet to clear its defaulted Paris Club debt," the newspaper said.

May corn closed at $3.97, up ¾ cents. Corn is stuck in a sideways range at around the $4 mark. The average trade estimate for corn ending stocks from the USDA tomorrow is 1.731 million bushels versus 1.74 in March and 1.624 a year ago with a range of 1.675 to 1.954. Cold and wet weather in the US threatens to put some potential corn acres into soybeans. With talk of the US ethanol mandate increasing from a 10% inclusion level up to 12-13%, and US exports already holding up well, any further reduction in US plantings could easily be construed as bullish.

Soybeans

May soybeans ended at $10.06, up 16 ½ cents. As with corn, soybeans are stuck in a sideways range, only this time it's round $10/bushel not $4/bushel. The USDA announced that China purchased another two cargoes (110,000 MT) today, proving that they haven't switched demand entirely to South America just yet. The average ending stocks guess for the USDA Supply & Demand report for soybeans is 169 million bushels versus 185 in March and 205 last year with the trade guesses ranging from 101 to 185 million bushels. Argy soybean production for the current season is also expected to be cut.

Wheat

May CBOT wheat closed at $5.32, down 7 ¾ cents. The weather in the Southern Plains is forecast to warm up and provide some rain in the next week or so. The jury is still out on exactly how much damage has been caused by the hard freeze earlier this week. My informants are telling me that output could easily be cut much more sharply than current official estimates are saying. The average trade ending stocks estimate for Thursday’s Supply Demand report for wheat is 697 million bushels versus 712 in March and 306 last year. The range of trade guesses are 666 to 727 million bushel.

EU wheat futures drifted lower Wednesday with Paris May milling wheat closing down EUR2.50 at EUR136.25/tonne, and November London feed wheat ending down GBP1.00 at GBP118.00/tonne.

For once it was a half decent volume day with 8,617 lots traded in Paris.

As per usual there was very little fresh news to get too excited about. Iraq bought 250,000mt of wheat Tuesday, with 100,000mt surprisingly going the way of the US.

Although some analysts said that this may have been a sop to a surprise visit from Obama to Baghdad, it is more likely to be due to Russia running out of the best quality wheat at last.

US wheat continues to struggle to stage a rally, despite reports of serious potential for crop damage in Kansas, Oklahoma and Texas by a heavy freeze at the beginning of the week when temperatures fell to 10F and lower in some parts.

Three cheers for NFU dairy board chairman Gwyn Jones, who has thrown his toys well clear of the pram on the news that over keen Arla & First Milk are to cut the price they pay their farm suppliers for milk. Indeed, if toy throwing was an Olympic event, then I think that Mr Jones has gold medal winning potential with this outburst. And I for one think he makes some very valid points. Take it away Gwyn:

“No sooner has Dairy UK started talking about the ‘green shoots’ of recovery in the dairy industry than its members come along and trample them underfoot.

“Not a day has gone by this month without there being news of another milk price cut – farmers would be forgiven for thinking that First Milk’s announcement of a 1.25ppl cut on liquid and cheese on April 1 was a bad April Fool’s joke, had it not been preceded only days before by Dairy Crest announcing a 1.25ppl cut for its Davidstow suppliers.

“Yet it’s Arla that has the biggest boots in being the first big liquid player to announce a milk price cut of 1ppl from May. My big concern is that Wiseman’s and Dairy Crest will see this as an opportunity to follow Arla’s lead.

“Milk Link must be applauded for holding its April price, but why are they one of a minority of processors able to achieve this? Serious questions need to be asked about how effectively other companies are managing the pressure and how effective their strategies are for getting the best returns from a volatile market.

“I do understand that the British cheddar market is under substantial pressure. Cheap cheddar imports are dragging the market downwards and wholesale cheddar prices are predicted to fall further. Also, in the liquid market we are seeing a growing divergence between milk destined for retail shelves and the volumes swilling around in the middle ground.

“Any processor that is brokering milk or manufacturing commodity cheddar will be massively exposed to poor returns in a weak market where contracts are being renegotiated frequently. However, the ingredients market appears to have bottomed out in recent weeks, assisted by the opening of intervention and Private Storage Aid, which have seen EU and UK commodity prices stabilise. Cream prices actually increased between February and March and further weakening of sterling recently only improves our position. All this means that any cuts linked to further pressure in ingredients and falling cream prices have to be challenged.

“However, Arla is neither a broker nor a cheese manufacturer. Quite the opposite in fact. Arla is one of the most well invested, efficient leaders in the British liquid milk market with over 85 per cent of its liquid milk being sold into the major retailers. This share has grown in recent weeks with Arla being awarded an additional ten per cent of Tesco’s business – equivalent to around 90 million litres. It begs the question – what is going on here?

“I’ve no doubt that Arla, like other processors, is feeling the brunt of retail pressure on promotions and margin squeezing. Yet DairyCo’s latest report reveals that there is more than enough margin to go around on liquid milk to allow everyone to get a fair slice of the cake. Margins for liquid processors have increased by 2.91ppl over the last year. Having undoubtedly absorbed the volatility in cream prices during 07/08, it would seem that processors are more than making up for it now, by increasing their gross margins through farmgate cuts. With the latest figures putting the cost of milk production at nearly 27ppl, retailers and processors would be wise not to gamble with security of supply.

“The common denominator in all these price cuts is the weak contract that allows any buyer to recoup their costs at the farmers’ expense. Once again, the NFU urges all farmers to print off a copy of the NFU template milk contract, sign it and give it to your milk buyer or representative. The NFU is here to support any of its dairy farming members in getting a better, fairer milk contract.”

This season's Canadian canola crop is already at risk from drought, according to StormX.

Canola in the Canadian prairies is typically planted from late April into early May leading to flowering during the months of June and July. Drought in central Alberta dating back to last fall, which has actually intensified over the past 30 days, has raised the concern over a disappointing canola yield come August and September, say StormX.

Precipitation has been more than 2 inches below normal in some locales. The biggest concern for the Alberta canola crop is if the drought persists into the flowering months as the crop is very susceptible to drought stress. Unfortunately, the May-June-July long range precipitation forecast from Canada’s Weather Office shows below normal precipitation during this three month period, they add.

The overnight eCBOT markets are lower Wednesday morning on follow through from last night's CBOT close, weaker crude and a firmer dollar.

Crude oil is down $1.22 at $47.93/barrel ahead of US stocks data later today expected to show inventories at their highest levels since 1993.

The US dollar extended gains against the euro and the pound as Asian and European stock exchanges followed Wall St lower on concerns about the impact of deepening global recession on the upcoming round of earnings reports.

The USDA releases its revised WASDE and US stocks data tomorrow. Further cuts can be expected to soybean production in Argentina, and a tightening old 2008/09 ending stocks in the US.

The cut in the size of the Argentine crop and nervousness over the ongoing dispute between the government and farmers there may keep major importing countries like China reluctant to commit to making too many purchases in that direction. That may keep the door open for US sales a little longer than normal.

The Chinese government however are expected to soon start winding down their domestic purchases of soybeans and corn, which may mean that local crushers and feed mills may scale back their buying of imported material.

Iraq bought 100,000MT of US wheat overnight, despite a $30+ price disadvantage to Russian wheat. this may signify that top quality Russian supplies are dwindling. Egypt has shown a few signs this past couple of weeks that it too may be having to spend a little bit more money elsewhere to at least get some high-grade wheats to mix in with some Russian material.

It is still to early to accurately predict the true impact of a severe drop to sub-zero temperatures in the Southern Plains on this season's US wheat crop. It certainly seems likely that some damage has been done with temperatures plunging to 10-12 degrees F in parts of the top wheat producing state of Kansas Monday/Tuesday.

Significant losses are also possible in Oklahoma, where wheat development was most advanced, with eighty six percent of the state's wheat crop jointing, according to StormX.

Further east & north it remains largely too cold and/or wet to crack on with plantings just yet. The Dakotas are still on flood alert which will also delay plantings, and possibly wipe out intentions for up to a million acres of spring wheat sowing according to some reports.

In the longer run, the current US weather pattern could mean more beans and less corn & wheat going into the ground. With farmers able to plant beans up until the end of June, and the associated lower inputs, last week's USDA estimate of 76 million acres could yet prove to be on the low side.

Iraq announced the purchase of 250,000MT of hard wheat Tuesday, with 100,000MT of it coming from the US. They also bought 100,000MT of Russian wheat and 50,000MT of Canadian wheat.

It is interesting that the US should pick up this surprise business, especially when you consider that the Russian wheat was just over $30/tonne cheaper than the US grain.

Some analysts are saying that the buy was a token gesture to President Obama who was making an unscheduled visit to Baghdad.

That wouldn't explain however the Canadian purchase, which was also priced substantially dearer than the Russian wheat. More likely, I'd suggest, is that much of the high quality Russian grain has already been sold & shipped this season, and that the North American purchases are based on quality.

Since the ousting of Saddam Hussein Iraq had been a major importer of US wheat, but the country's last major US purchase was way back in February 2008.

The country is expected to consume around 4 million tonnes of wheat this year, but produces only around one eighth of that.

May corn closed at $3.96 ¼, down 9 ¼ cents. Although there are quite a few bullish arguments around for corn at the moment, it seems that outside influences rule. Crude was sharply lower closing below $50/barrel, down more than $2.50 at $48.40/barrel. A firmer dollar and weak stocks added to the bearish tone. Cold and wet conditions throughout much of the US corn belt are delaying plantings and potentially leading to lower US seedings. The average trade estimate for corn ending stocks in Thursday's USDA report is 1.731 million bushels versus 1.74 in March and 1.624 a year ago.

Soybeans

May soybeans finished at $9.89 ½, down 4 ½ cents. As corn is struggling to close above $4 and stay there, beans are doing likewise above $10/bushel. Again, as with corn, there are quite a few bullish indicators around for beans which are getting pushed onto the sidelines for the time being. The USDA report due Thursday should reduce old crop ending stocks towards rather tight 165 million bushels versus 185 in the last report. Conab upped their Brazilian crop estimate a bit to over 58 MMT. Private reports I am reading suggest that thi sis rather optimistic, but I guess we have to live with it.

Wheat

May CBOT wheat closed sharply lower at $5.39 ¾, down 17 ¼ cents. As with the other two main commodities, bullish influences got largely pushed into the background. Potential production losses from a sharp weekend freeze in the US got largely ignored. The average trade ending stocks estimate for Thursday’s Supply & Demand report for wheat is 697 million bushels versus 712 in March and 306 last year.

EU wheat futures closed another quiet session mixed Tuesday with Paris May milling wheat ending up EUR1.25 at EUR139.00/tonne. London May feed wheat finished down GBP1.50 at GBP109.00/tonne.

The market is desperately in need of direction, but conflicting influences continue to drag the market sideways.

Very cold temperatures in the US over the weekend and Monday night must surely have caused some significant damage to wheat on the Plains. Temperatures fell as low as 6 degrees F, according to some reports, with heavy losses anticipated in Oklahoma, where wheat development was most advanced, with eighty six percent of the state's wheat crop jointing, according to StormX.

It may take a week or so for some firm news to emerge on how badly the US crop may have been damaged by the recent plunge in temperatures.

A firmer US dollar helped support European wheat prices, although weaker crude oil and falling equities capped gains.

French exports remain well above last year, with stocks surprisingly lower than year ago levels. German wheat production is also seen down in 2009, along with that in the UK. Judging on much of the data emerging recently, it seems that the anticipated "huge carryover" may not be anything like as large as some in the media are expecting.

Having traded higher for most of the session eCBOT grains turned lower into the close with wheat finishing down around 6 cents, corn off 3 cents and soybeans flat to down 1 cent.

Wheat had gained earlier on news released after last night's close showed US winter wheat conditions worse than expected at 22% poor/very poor.

Cold and wet weather across much of the US is seen delaying corn plantings, which could ultimately lead to more soybean acres getting seeded than the 76 million acres projected by the USDA last week.

Grains failed to hold on to early gains however as crude oil started to slide, global stock markets fell and the dollar firmed.

The dollar rose as data was released showing that economic contraction in the euro area in the fourth quarter was more than initially estimated. The dollar also gained a bit of ground against the sterling as the British Chambers of Commerce confirmed that the UK recession is still very serious and expects it to continue for some time.

The DJIA is expected to open lower this afternoon, extending losses into a second day

Dryness in Argentina is helping get the harvest in, but yields are proving disappointing. The soybean harvest is now estimated at 25% done, and the corn crop is 34% in, according to official reports. "Some crops will be turned over to grazing due to the poor outlook for yields," the Agricultural Secretariat said.

In the US Farmers generally want soil temps at around 55 degrees to get cracking with planting. The only areas with those kind of soil temps right now are Kentucky and Tennessee, and both of those have excessive moisture problems at the moment.

On Thursday USDA will release its monthly updates on supply and demand. Most analysts see soybean old crop ending stocks tightening from last month as export sales continue to be robust. A lower production number from Argentina also looks highly likely.

Early calls for this afternoon's CBOT session: Corn futures are expected to open 2 to 4 lower; soybeans steady to 2 lower; wheat 4 to 6 lower.

It's not just here in the UK that the dairy industry is feeling the pinch, the situation is replicated across the rest of Europe too.

German dairy farmers fear that their numbers will be massively reduced in the next year as milk prices continue to go down, daily Neue Osnabrücker Zeitung reported on Tuesday.

"When the situation remains the same as it has been, then one-third of the farmers won’t make it through the next year," President of the German dairy farmer's federation (BDM), Romuald Schaber, told the paper. "That’s 30,000 operations."

The BDM has complained of low milk prices for some time, and in May last year staged a 10-day delivery strike to protest prices they said were too low to support their costs. Prices were between €0.27 to €0.35 per litre. Farmers openly threw surplus milk down drains, fed it to their calves, or spread it over crops.

If things weren't going bad enough for the UK dairy sector already First Milk & Arla have announced further milk price cuts.

First Milk has cut it's milk price by 1.25p per litre from April 1, blaming declining cheese and ingredients returns.

Arla has announced a 1ppl reduction from May 1, saying that they had "made the decision to drop the price to reflect the impact on Arla’s surplus cream returns."

Both companies, and their competitors, have cut prices steadily since the turn of the year blaming falling commodities markets, difficult trading conditions in the current economic climate and the European milk price slide.

A week after saying that full-year figures would beat forecasts, Yorkshire-based food producer Cranswick says it has bought Bowes of Norfolk Ltd., from the Bowes family for GBP 17.2 million cash.

The deal, which is expected to be complete within around 10 weeks - subject to regulatory approval, will give Cranswick an estimated 15-20% of the UK pork market. This will make Cranswick the country’s biggest British-owned producer of pig meat.

It is understood that, once the deal is completed, the pig-rearing arm of the Bowes business will be sold back to a management buy-out team.

Sainsbury's account for around a third of Cranswick's turnover, the purchase of Bowes potentially provides a useful foot in the door with Tesco, who account for more than half of Bowes' annual sales.

The association of German farm cooperatives (DRV) estimates that 2009 grain production in Germany will total 47.3 MMT, compared to its previous estimate of 47.5 MMT. That would represent at 5% reduction on last year’s output of 49.8 MMT. German trading house Toepfer currently estimate production at 46.5 MMT, a 6.6% drop on last season.

Wheat production from the DRV is seen down 5% at 24.7 MMT, whilst Toepfer see it 7.3% lower at 24.1 MMT.

Despite all the media doom and gloom, and reports of how the EU is continuing to miss export business to the Black Sea, French grain exports are up sharply. Not only that but stocks are actually down on year ago levels.

France has exported 9.6 MMT of soft wheat in the first seven months of the 2008/09 marketing year, and increase of 45% on the 6.6 MMT exported at the same point a year ago, according to official government figures.

Of this quantity 3.8 MMT (4.3) went to other EU countries, including Netherlands 919,000 MT (1.3), to Belgium 759,000 MT (799,000), to Italy 878,000 MT (903,000), to Spain 521,000 MT (407,000), to Portugal 333,000 MT (367,000) and to Germany 179,000 MT (249,000). Exports to third countries increased sharply by more than 150% to 5.8 MMT from 2.3 MMT.

Barley export were up 20% to 3.0 MMT and corn exports 50% higher at 3.6 MMT.

Out of interest, French corn exports to the UK were lower year-on-year at 272,000 MT from 337,000 MT in 2007/08.

Despite last seasons bumper harvest, the pace of exports means that grain inventories are actually a little lower than year ago levels.

ONIGC reports that commercial grain stocks in France amounted to 14.7 MMT as of March 1, 2009 which is below the 15.0 MMT recorded at the same time of last year. Wheat stocks (excluding durum) stood at 6.0 MMT (6.9), barley stocks at 3.4 MMT (2.6), corn at 4.6 MMT (4.7), and durum wheat at 361,000 MT (534,000).

Monday night saw the first of the USDA's weekly crop condition reports for wheat since November. With winter wheat lying dormant in the ground no national reports are produced between November and March.

The last set of figures we had to go on in November said that 65% of the young crop was in good/excellent condition and that 8% of the crop was rated poor/very poor.

Last night's numbers show the percentage of the crop rated in the top two categories has fallen sharply to 43%, a 22 point drop since November, the joint second largest fall since the USDA started producing weekly figures in 1986. The average good/excellent rating for this time of year is 54%.

Meanwhile, the poor/very poor category has increased from 8% to 22% during the same period.

In Kansas, the top producing winter wheat state, the percentage of the crop in the top two categories has fallen from 74% to 39%. Whilst in Oklahoma it is now 25% from 63% and in Texas 12% from 48%.

In Texas a whopping 64% of the crop is now rated poor/very poor.

These figures are based on crop conditions as of Sunday. It will be very interesting to see how next weeks numbers pan out given the widespread sub-zero temperatures forecast for last night.

Unlike most of Europe and the US, in Russia spring wheat can account for up to 50% of total wheat plantings.

Satellite-derived vegetation indices indicate that early-season conditions for the fall-sown winter crops are mixed. Persistent dryness in the Southern District (which accounts for around 60 percent of the country's winter wheat) likely hampered crop emergence and establishment, especially in the key Krasnodar territory.

Spring wheat area has declined in recent years, and is likely to contract further this coming season due, in part on the availability of credit for the spring planting campaign.

Barley production is seen down almost 20% from 23.1 MMt to 18.6 MMT, says the attaché .

The US winter wheat crop will be exposed to potentially damaging temperatures Monday night when temperatures fall into the low and mid 20s F, say StormX.

Injury to jointing wheat will occur when temperatures fall to the mid 20s F for at least 2 hours, long enough to kill the growing point that is located above the soil surface, they say. The stem growth will stop immediately above the growing point and yield losses will vary, depending on the extent of freeze damage in the affected stems. Mild stem injury does not appear to interfere with ability of wheat plants to take up nutrients from the soil and translocate them to developing grain, according to research conducted by Kansas agronomists.

Jointing was just beginning in Kansas on March 26th, reportedly 9% under way in the south-central district and 15% in central Kansas. Jointing was most advanced in the southwest district at 20%. Minimum temperatures tonight are expected to bottom out in the low to mid 20s F in Wichita (23), Dodge City (25), Garden City (22), Hutchinson (20), Medicine Lodge (23) and Liberal (22). These cities are all located in the southern half of the state.

Vulnerability to freeze damage is greater in Oklahoma, where crop development is more advanced. Statewide 62% of Oklahoma wheat was jointing March 26th while a few fields in the southwest part of the state had already reached the boot stage. Predicted lows for tonight are: Enid (22) Hobart (29) Lawton (26) Ponca City (24) and Stillwater (24). Temperatures will rebound into the low 40s F Tuesday night in Oklahoma and Kansas.

May Corn closed at $4.05 ½, up 1 cent. Corn closed a little better on the day trading on both sides of the market throughout the day and remaining in the consolidation of the past five days. The dollar finished higher as investors search for a less risky place to park their money. Private exporters reported to the USDA, export sales of 116,000mt of corn for delivery to unknown destinations. Of the total 58,000mt is for delivery during the 2008-2009 marketing year and 58,000mt is for delivery during the 2009/2010 marketing year. Changes in destination of 116,000mt of corn from unknown destinations to South Korea for delivery during the 2008/2009 marketing year were announced. Today’s exports for inspection report showed 42.29 million bushels, 11% better than last week. USDA export projections for marketing year 2008/2009 are forecasted at 1.9 billion bushel. Below freezing temperatures are forecast as far south as south central Texas, southern Louisiana, Mississippi and central Alabama.

Soybeans

May soybeans finished at $9.94, down 1 ½ cents. Soybeans met with selling as they reached the $10.00 mark on the May contract in today’s trade. New crop soybeans were much lower than the old crop on ideas there could be a shift in acres to later planting of soybeans due to the recent cold and wet weather in the wheat growing areas. Pessimism seems to have entered the stock markets in the US and abroad with the Dow nearly 100 points lower going into the end of the Monday. Today’s USDA grains inspected for exports report was 16.33 million bushels. Current market year inspections are 10% above the previous year to date numbers.

Wheat

May CBOT wheat closed at $5.57, down 6 ½ cents. Wheat futures prices closed lower on all three wheat exchanges today. Weekly wheat inspections for export are 16.45 million bushels, about 5% above the previous week. The weather market has begun for wheat with below freezing temperatures in Kansas, Colorado, Nebraska, Oklahoma and south east Texas across to Central Alabama. There are no official crop damage reports as of this writing and probably won’t have anything concrete for a couple of days. Once the weather passes and the temperatures warm up it will be easier to assess the damages. Winter wheat crop condition report out today showed 22% of the crop in poor/very poor condition.

Finally getting round to binning the last of the compulsory child seats for the car over the weekend, got me thinking.

When we were kids we had no child seats. We had no fcukin seats at all in the back of my Dad's van. We used to roll around in the back every time he turned a corner.

And when my two brothers & I rode the one bike we shared, we had no helmets, we didn't even have any shoes on half the time.

Even though all the shops closed at 5.00pm and didn't open on the weekends, somehow we didn't starve to death.

We shared one bottle of pop with our mates and NO ONE actually died from this.

We could collect old drinks bottles and cash them in at the corner shop and buy chewie or sweets. We ate loads of white bread and real butter and drank soft drinks with sugar in them, but we weren't overweight because...... WE WERE ALWAYS OUTSIDE PLAYING!! We would leave home in the morning and play all day, as long as we were back when it got dark. No one was able to get hold of us all day, and we were OK.

We would spend hours building go-carts out of scraps of wood and some pram wheels we'd found, and then ride down the hill, only to find out we'd not bothered with brakes. We built tree houses, caught sticklebacks and lit fires. Loads of fires.

We did not have Playstations, Nintendo's, X-boxes, satellite TV, no videos, no DVD's, no surround sound, no mobile phones, no 99 channels of abject American shite on TV to chose from, no personal computers, no internet and no MSN.........INSTEAD WE HAD FRIENDS. We fell out of trees, got cut, broke bones and teeth and got chased by the bloke down the road for nicking his apples.

And we could only buy Easter Eggs and Hot Cross Buns at Easter time. We got pellet guns and catapults for our 10th birthdays!

We walked to and from school on our own or with our mates, we never got a lift anywhere, EVER. Sports Day was competitive. If you were no good you got beat and accepted it. Our teachers used to hit us without fear of getting sued and losing their jobs.

And our parents didn't invent stupid names for their kids like 'Kiora' or 'India'. We wrote our homework out by hand, and we didn't pass our exams by simply copying what the teacher wrote on the board. Neither did we go on exchange trips to France, squeeze in a weeks skiing with the school in Gstaad before jetting off to the Med for a fortnights recharging of batteries before another hectic high-pressure school term. If we'd have took a form home asking my Dad to set up a direct debit so we could go to Switzerland next year he'd have told us to sod off. We went to Rhyl, for the day.

Grains are firmer on the overnight eCBOT market on news that the forecast weekend wintry conditions in the US were more severe than originally anticipated, and sub-zero lows are forecast to last at least until the middle of the week.

Winter wheat crops emerging from dormancy are at risk from winterkill as temperatures fall as much as 24 degrees below normal, this comes after a warmer than normal March "fooled" wheat into thinking spring had arrived early.

Freezing rain and snow will also keep farmers out of their fields, delaying spring planting of corn.

Soybeans continue to benefit from last week's acreage numbers. With spring plantings forecast up only 300,000 acres from last year to 76 million acres. While this will be the most acres of soybeans ever planted in the United States, industry participants were expecting 79.25 million acres.

Meanwhile US soybean exports are projected for a record 1.225 billion bushels in 2009/10, the Agriculture Department chief economist, Joe Glauber, said last week.

Outside markets are also supportive, with Japan's Nikkei closing at a three month high Monday, crude oil almost a dollar firmer and the US dollar lower across the board.

At 9.15BST soybeans were around 10-12 cents firmer, wheat up around 5-6 cents and corn 1-2 cents higher.

The total number of pigs slaughtered in 2009 will be about 250 million, 2% down on 2008, a European Commission report has indicated. Numbers are falling due to last year’s high feed prices and the financial crisis, the report says.

The figures have been based on numbers submitted by each individual country at the beginning of this year, although not all countries have submitted their data yet, the indications are that numbers are down, according to the report.

In Germany, the number of slaughterings is expected to decrease by 1.8% to 53.8 million, followed by Spain (-2.1% to 40.4 million), France (-2.9% to 24.9 million), Denmark (-0.6% to 20.6 million) and the Netherlands (-0.5% to 14.4 million).

Most production losses can be found in Eastern Europe. In 2009, Czech slaughterings will be only slightly over 3 million, a 19.7% decrease.

Shares in Carr's Milling Industries are more than 11% lower at 400 pence in early trade Monday after the company warned that pre-tax profit for the full year will be lower than last year as it announced half-year figures.

"For the 52 weeks to 29 August 2009, the board expects the pre-tax profit to be appreciably lower than last year's underlying figure, reflecting mainly the weakness in fertiliser but also the impact of the increased retirement benefit charge," said the group.

Anyone who knows anything about agriculture will know that matching 2008's performance is going to be highly unlikely in 2009 for any agri-business.

Exactly two years ago, a record-breaking freeze hit the southern Plains and Deep South, setting the wheat market into a frenzy and marking the beginning of a bull run lasting more than a year. Wheat doubled in price from the time of the April 2007 freeze until the top of the market, a year later. Is history getting ready to repeat itself, asks Allen Motew of QT Weather?

It is certainly beginning to look that way. The Southern Plains saw a hard freeze Sunday morning. Lows in Kansas, Oklahoma and Texas will be even colder on Monday. Monday morning will be even colder than Sunday with teens in Kansas and low twenties in Oklahoma and N Texas…enough to cause widespread damage to the HRW crop, he says.

After that a third day of severe cold will hit the Southern Plains Tuesday, reaching the Lower Mississippi Valley and SRW crop too, adds Allen. Southern states will see readings far below freezing Wednesday morning hurting numerous perishable crops as well as hardy varieties too, very similar to the April 4-9, 2007 freeze, warns Allen.

The 2007 freeze was so destructive because it followed two to three weeks of well above normal temperatures (highs mainly in the 70s and 80s/lows mainly in the 50s and 60s). This kicked off the growing season a little early, with vegetation stressed when temperatures plummeted. The pattern this year seems strikingly similar with growing degree days well above average so far in 2009. Most states from the southern Plains to the Corn Belt and across the South saw a muchwarmer than normal March setting the stage for history to repeat itself, he warns.

The Soft Red Wheat crop across Arkansas and the Mid-Mississippi Valley will see record low temperatures Tuesday morning. The all-time lowest April temperature in Little Rock is 28 degrees F. Tomorrow QT Weather say that a low of 24 degrees will hit Little Rock, with potentially devastating results. In 2007, before the freeze hit, 6% of the crop was rated poor/very poor, post-freeze this number had shot to 64%. In Tennessee it went from 3% to 84%.

About Me

Worked in agriculture for over 30 years as a shipper, merchant, trader & broker, but still hasn't got the faintest idea what he's talking about.
Likes beer apparently, so why not do the decent thing an hit the donate button you tight bastard?
He can also provide content for your website like market reports and commodity prices. And if you haven't got a website he can design one for you. In short, the man's a bloody genius.

Disclaimer

All comments on this website are the sole opinion of the author, and are not capable of nor intended to constitute professional advice. Neither can Nogger give any guarantee for the accuracy of any of the information or data contained within this site.

The guy is clearly deranged and you should almost certainly ignore everything that he says.